Life Support - Tax Facts
Your State Return: Just Because It's Little, Doesn't Mean It's Optional
A Tax Fact from The Tax Institute at H&R Block
For many, the filing of an individual state income tax return is often looked at as "optional." This is so wrong. Like it or not, filing your state tax return is mandatory if you meet the filing requirements defined by each state.
Whether you have to file a state tax return depends on:
As a general rule, if you have to file a federal tax return you need to file a state tax return as well. You must file a tax return in your state of residence reporting income from all sources and/or any state where you received income. Only Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming do not impose a state income tax. Additionally, New Hampshire and Tennessee limit their state income taxes to dividends and interest income only. For all the rest of us, it's pretty clear: we must file a state return too.
There are consequences to not filing your state return and those consequences can quickly add up to lots of dollars. If a tax due return is not filed by the due date, or within the extension period, a penalty will be assessed for both failure to file AND failure to pay. In addition to penalties, the states also will charge you interest.
How does the state know you haven't filed a return? The state receives information regarding your income from the IRS and will send you a "failure to file notice." When you file a federal tax return the IRS shares your filing information with the states. Therefore, if you file a federal tax return, the IRS IS going to share that information with the state. It is just as important to file and pay your state income tax as it is to file and pay your federal income tax.
This Tax Fact is brought to you by The Tax Institute at H&R Block.
To view other helpful tax information or listen to our Tax Fact podcasts, visit www.digits.hrblock.com
As always...everyone's tax situation is different, so be sure to consult a tax professional or financial advisor before making important financial decisions.
This Tax Fact is for educational purposes only and is not intended to be a substitute for seeking personalized, professional advice, nor is it intended to be used to avoid IRS penalties.
A Tax Fact from The Tax Institute at H&R Block
For many, the filing of an individual state income tax return is often looked at as "optional." This is so wrong. Like it or not, filing your state tax return is mandatory if you meet the filing requirements defined by each state.
Whether you have to file a state tax return depends on:
- Filing status,
- Age,
- Gross income and
- Residency status
There are consequences to not filing your state return and those consequences can quickly add up to lots of dollars. If a tax due return is not filed by the due date, or within the extension period, a penalty will be assessed for both failure to file AND failure to pay. In addition to penalties, the states also will charge you interest.
How does the state know you haven't filed a return? The state receives information regarding your income from the IRS and will send you a "failure to file notice." When you file a federal tax return the IRS shares your filing information with the states. Therefore, if you file a federal tax return, the IRS IS going to share that information with the state. It is just as important to file and pay your state income tax as it is to file and pay your federal income tax.
This Tax Fact is brought to you by The Tax Institute at H&R Block.
To view other helpful tax information or listen to our Tax Fact podcasts, visit www.digits.hrblock.com
As always...everyone's tax situation is different, so be sure to consult a tax professional or financial advisor before making important financial decisions.
This Tax Fact is for educational purposes only and is not intended to be a substitute for seeking personalized, professional advice, nor is it intended to be used to avoid IRS penalties.
